The RBI (Reserve Bank of India) is reportedly tracking mobile wallet companies and their monthly status reports pertaining to the number of customers who have completed their authentication procedures or KYC (know-your-customer) as per its directives.
Mobile wallet companies are providing reports on a monthly basis to the RBI with information on the number of wallets that have been created and how many of them are now KYC compliant. KYC compliant wallets account for a minimal chunk of the total number of wallets. However, as per the latest reports, 1/4th of mobile wallet users have already completed the basic KYC requirements which will remain valid for a period of 12 months.
The total KYC will necessitate physical/biometric verification and the minimum KYC can be executed with an OTP (one-time password) via one’s smartphone. Mobile wallets that have the minimum details of customers like the mobile number and identity proof will keep their KYC valid for just 12 months. After this period, full KYC will be required for keeping one’s wallet functional. However, with the disabling of Aadhar authentication based on mobile number by the UIDAI in case of unlicensed entities, the validation procedure has become tougher.
Interoperability of mobile wallets can be expected soon and this will scale up the chances of risks and regulators will definitely look at KYC as one of the basic aspects towards tackling multiple issues.